The Fed Weighs More Easing Amid Economic Doubts

[bobbyw24]

More Fed officials are hinting the economy needs more quantitative easing, very loose monetary stimulus programs designed to pump up the economy. San Francisco Fed President John Williams says unemployment will stay high, which "does make an argument that we should have more stimulus." Cleveland Fed President Sandra Pianalto said the Fed "should be even more accommodative."

http://www.moneynews.com/Headline/Fed-Easing-Economic-Doubts/2012/01/13/id/424097

 

[Zippyjuan]

I don't think they will change anything at their next meeting. The economy isn't booming but it isn't really slipping either. Their previous rounds of easing didn't exactly stimulate the economy much either. The image I get is trying to push a limp string. The Fed can't force people to buy more or get companies to hire more. About the Fed can do is try to lower interest rates but the rates the Fed controls are already at or near zero so going lower won't do anything. Buying more assets won't get banks or companies to borrow more and invest in producion either- companies won't hire until they see enough demand for their goods to justify it.

 

[Travlyr]

The Economy... The Economy... The Economy...

We live in a society of centrally planned economy, and unfortunately, right now they are planning it to remain bad for a lot of people.

The economy continues to struggle. The economy is bad. The recession continues. The economy might double dip into recession or even depression. The Fed Weighs More Easing Amid Economic Doubts. <- Propaganda.

• For people who are unemployed, underemployed, or living off of fixed income the economy is horrible.
• For employed people making adequate income the economy is bad but not yet horrible.
• For high wealth insiders (political, educational, medical, military & government contractors) a sluggish economy is not that big of a deal... it could be better but steak and lobster is still always an option... and so is a new car... and a new house for the children.

A central planned economy is a controlled economy based on distribution. Right now they are controlling it to starve some people and enrich others. If you are not going homeless or hungry, then that's great. It doesn't have to be that way for anybody.

A free market economy may struggle from time to time due to drought, flood, or some disaster. But there would be no talk of a struggling economy for years upon years due to distribution problems as there is today. The world provides abundance. There are plenty of food and resources for everyone.

 

[Steven Douglas]

• For high wealth insiders (political, educational, medical, military & government contractors) a sluggish economy is not that big of a deal... it could be better but steak and lobster is still always an option... and so is a new car... and a new house for the children.

Not just not that big of a deal. It's a vulture's paradise, with plenty of carcasses to finally feed on. It's hard asset-acquisition boom, and an opportunity to swoop in and suck real value out of the economy. Foreclosures to swoop in and buy up on the cheap. Nobody else is spending, which makes your money (or impossible to obtain credit) absolute king.

For the high wealth insiders, the table has been set, and it's feeding time.

 

[QE Is Theft]

companies won't hire until they see enough demand for their goods to justify it

And there won't be a demand for more goods until companies start hiring again....

This is why, above all else, I believe a consumption based recovery isn't possible.

What we need to do is what Peter Schiff said - start manufacturing things again.

And rebuilding the entire US infastructure wouldn't be a bad idea, either.

European style trams/trains, anybody?

 

[Zippyjuan]

And there won't be a demand for more goods until companies start hiring again....

This is why, above all else, I believe a consumption based recovery isn't possible.

What we need to do is what Peter Schiff said - start manufacturing things again.

And rebuilding the entire US infastructure wouldn't be a bad idea, either.

European style trams/trains, anybody?

You are right- it is a Catch-22 situation which is why it will take a long time for things to start growing much again.

What we need to do is what Peter Schiff said - start manufacturing things again.

And rebuilding the entire US infastructure wouldn't be a bad idea, either.

and as pointed out, that won't have a chance of happening until sales are stronger. Building train systems or pipelines from Canada to Texas will cost billions of dollars and produce few jobs (though they will be sold as ideas to create them).

 

[mises2pieces]

More Fed officials are hinting the economy needs more quantitative easing, very loose monetary stimulus programs designed to pump up the economy. San Francisco Fed President John Williams says unemployment will stay high, which "does make an argument that we should have more stimulus." Cleveland Fed President Sandra Pianalto said the Fed "should be even more accommodative."

It's amazing that economists (who should know better) debate whether we need more "stimulus" without ever questioning the idea that printing more paper "stimulates" the economy. Tequila provides a stimulus for me but the after-effects are always disastrous.

 

[ababba]

Not just not that big of a deal. It's a vulture's paradise, with plenty of carcasses to finally feed on. It's hard asset-acquisition boom, and an opportunity to swoop in and suck real value out of the economy. Foreclosures to swoop in and buy up on the cheap. Nobody else is spending, which makes your money (or impossible to obtain credit) absolute king.

For the high wealth insiders, the table has been set, and it's feeding time.

So that would imply the wealth of the richest american's grows faster in times like these but that's not true, its the exact opposite. The banks do much better in boom times than recession.

 

[bobbyw24]

More Fed Easing Will Push Inflation, Gold Higher Read more: David Skarica: More Fed Easin

Gold prices are due to climb in 2012, but don't rule out silver and keep an eye on stocks for good value investments, says David Skarica, editor of The Gold Stock Adviser newsletter and author of "The Great Super Cycle."

The United States will likely roll out more extraordinarily loose monetary policies such as quantitative easing, not solely due to necessity, but also to keep the dollar competitive with a weaker euro.

Such easing measures will fuel inflationary pressures, and when inflation even threatens to rear its head, gold rises and shines.

"I think because of the eurozone crisis, the euro is getting a little too weak for what the Fed would like to see, especially if the euro got down to the 1.20 area," Skarica tells Newsmax.TV in an exclusive interview.

The euro is currently trading around 1.29 per dollar.

Story continues below video.

http://www.moneynews.com/StreetTalk/Skarica-Gold-stocks/2012/01/19/id/424760

 

[QE Is Theft]

QE has ZERO effect on real estate prices, and only transient (in Bernanke speak) effects on stock prices.

The only thing it accomplishes is transferring more wealth from the poor and middle class to the rich.

Oil is currently over $100.

How in the blue fuck is $150+ a barrel after the Fed announces another round of QE (theft) gonna help the economy?

If anybody can explain how this is a benefit, lay it on me. I'm all ears.

 

[ababba]

QE has ZERO effect on real estate prices, and only transient (in Bernanke speak) effects on stock prices.

The only thing it accomplishes is transferring more wealth from the poor and middle class to the rich.

Oil is currently over $100.

How in the blue fuck is $150+ a barrel after the Fed announces another round of QE (theft) gonna help the economy?

If anybody can explain how this is a benefit, lay it on me. I'm all ears.

Two questions

1. Does printing money raise nominal GDP? (the dollar value of all goods and services produced)

2. Are prices perfectly flexible (do all prices in the economy adjust immediately to money printing)?

The rest is simple logic

 

[awake]

It's like a counterfeiter weighing whether he should print his next weeks paycheck. Hollow words from an institution the makes evil affordable and too big to fail.

"By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens"...

"Lenin was certainly right. "There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose." - Keynes

So what will it be Comrade Bernanke?

 

[awake]

Two questions

1. Does printing money raise nominal GDP? (the dollar value of all goods and services produced)

2. Are prices perfectly flexible (do all prices in the economy adjust immediately to money printing)?

The rest is simple logic

1. GDP is calculated from the prices of all goods/services multiplied by total produced within a country. Inflation indeed affects GDP and there are some ways that economists calculate to mute the way inflation affects GDP - never completely.

2. Inflated dollars enter the economy through certain government departments and industries. The effects are witnessed in these areas first - one can never guess the inflow points well. Prices rise first in the select entry points and cascade throughout the economy in many ways.

 

[ababba]

1. GDP is calculated from the prices of all goods/services multiplied by total produced within a country. Inflation indeed affects GDP and there are some ways that economists calculate to mute the way inflation affects GDP - never completely.

2. Inflated dollars enter the economy through certain government departments and industries. The effects are witnessed in these areas first - one can never guess the inflow points well. Prices rise first in the select entry points and cascade throughout the economy in many ways.

Ok well I don't agree with everything you said but by agreeing to those two points you imply that printing money affects the real amount of goods produced in the economy.

 

[Steven Douglas]

Ok well I don't agree with everything you said but by agreeing to those two points you imply that printing money affects the real amount of goods produced in the economy.

Well, if you consider housing alone, and the fact that most new houses built are developed as a direct result of fractional reserve lending, I would say that is one very real way that printing money affects a) rising prices first in the select entry point, and b) the real amount of goods produced in the economy, regardless of how it cascades or propagates outwardly from there.

 

[QE Is Theft]

, if you consider housing alone, and the fact that most new houses built are developed as a direct result of fractional reserve lending, I would say that is one very real way that printing money affects a) rising prices first in the select entry point

True, under normal economic conditions when banks are willing to lend.

Right now, they aren't lending shit unless someone has AAA credit.

So, banks are parking the majority of their funds with the Fed, and in US treasuries, and leeching off the interest from both, rather than lending to the public, or other banks.

As a result, housing prices continue to be abysmal, and will be for some time, till' the vultures clean out the carcasses of short sales and foreclosers.

These vultures will be the true saviors of the housing market.

Not the Fed and QE.

 

[ronpaulhemp]

I really hope the Fed doesn't go through with this. Enough with QE!!

 

[Zippyjuan]

As I predicted- no change by the Fed- they said it may be 2014 (always subject to change though) before they expect (based on currently available information) to even consider any changes to policy.

 

[Steven Douglas]

Let me tell you why, besides history as a guide, I would never trust anything that comes from the Fed, or equate any behavior of the Fed with any communication by the Fed. Forget that 16 TRILLION was created IN SECRET for foreign central bank bailouts. Forget that the Fed resists all auditing attempts at getting transparency. Instead look at Bernanke's mindset, coming from a speech he gave in 2002:

The conclusion that deflation is always reversible under a fiat money system follows from basic economic reasoning. A little parable may prove useful: Today an ounce of gold sells for $300, more or less. Now suppose that a modern alchemist solves his subject's oldest problem by finding a way to produce unlimited amounts of new gold at essentially no cost. Moreover, his invention is widely publicized and scientifically verified, and he announces his intention to begin massive production of gold within days. What would happen to the price of gold? Presumably, the potentially unlimited supply of cheap gold would cause the market price of gold to plummet. Indeed, if the market for gold is to any degree efficient, the price of gold would collapse immediately after the announcement of the invention, before the alchemist had produced and marketed a single ounce of yellow metal.

What does that tell me? That Ben Bernanke knows full well that information is power, and that tipping ones hand has intense ramifications.

Substitute Fed NOTES for the word gold, and the principle is EXACTLY THE SAME:

What would happen to the price of FED NOTES? Presumably, the potentially unlimited supply of cheap FED NOTES would cause the market price of FED NOTES to plummet.

Knowing that, is it not in the interests of the Fed to control the flow of information? To NOT announce anything beforehand? You know, knowing in advance that the value of Fed notes would "collapse immediately after the announcement of the invention" (of new currency), "before the alchemist had produced a single" new counterfeit?

Which brings us to A Very Strong Incentive for misinformation and disinformation (for our own good, of course) - and a need for as little transparency as possible, and no way to verify anything. In other words, if ANY truthful and accurate information was not in the Fed's best interests, is there ANY reason to believe that we will have access to it? Some would argue that what we don't know can't hurt us, but I would argue that what we don't know is literally KILLING us. The entire economy is one big Ponzi distortion, with the Fed the greatest proven liar and facilitator of them all.

 

[Lafayette]

The Fed Weighs More Easing Amid Economic Doubts

DO IT!!

I have some junior miners that have been in the red for like 6+ months and i'd like to get out of them without a loss....well a big profit if the easing is large enough